Adjudication is an informal dispute resolution process within the Building and Construction Industry Security of Payment Act 1999 (NSW) (the Act). Adjudication applies to construction work and/or related goods and services carried out in New South Wales.
If you haven’t made a payment claim, read our insight on ‘How a payment claim can get you paid‘ for more information.
However, if you have made a payment claim, you will be able to apply for adjudication in order to receive payment.
How do I apply for adjudication?
In order to apply for adjudication, you must complete an adjudication application form. This form can be obtained from any Authorised Nominating Authority (ANA).
Your adjudication application must comply with a series of requirements. For instance, it must:
- be in writing;
- be lodged with the ANA within the required time;
- request the nomination of an adjudicator;
- be served upon the respondent at the same time;
- be accompanied by any ANA’s application fee;
- include a copy of the payment claim and payment schedule (if any);
- include all information in support of the claim that you want the adjudicator to consider; and
- include a copy of the contract.
When can I apply for adjudication?
It is important to note that there are strict time limits for making an adjudication application.
When you receive a payment schedule that sets out an amount less than the amount in your payment claim, you must apply for adjudication within 10 business days of receiving the payment schedule.
If the respondent fails to pay the whole (or any part) of the payment schedule by the due date, you must apply for adjudication within 20 business days after the due date for payment.
When the respondent fails to provide a payment schedule and fails to pay the whole or any part of the claimed amount by the due date, you must:
- notify the respondent within 20 business days of the payment due date that you intend to apply for adjudication;
- allow the respondent 5 business days to provide a payment schedule after receiving the notice of intention; and
- apply for adjudication within 10 business days of the 5 day payment schedule period.
How do I choose an ANA and adjudicator?
You can choose the ANA who:
- receives the adjudication application;
- nominates an adjudicator; and
- can issue an adjudication certificate.
Once you submit the adjudication application form with the ANA, they will pass the application to a qualified adjudicator who decides if they will accept it.
How much does it cost?
The costs of adjudication include:
- adjudicator fees and expenses; and
- the Authorised Nominating Authority fees.
Note: You and the respondent must pay the adjudicator’s fees equally, unless the adjudicator decides otherwise.
What happens after I apply for adjudication?
After you submit the adjudication application, the ANA will contact an adjudicator from their panel of adjudicators. If the adjudicator accepts, you and respondent are notified.
If you don’t receive acceptance of your adjudication application within 4 business days, you can withdraw and reapply with another ANA within 5 business days.
After notifying you and respondent that an application has been accepted, the adjudicator has 10 business days to make a determination, unless the parties agree to a longer period of time.
How does the adjudicator determine the application?
In determining an application, the adjudicator will consider all documents provided as part of the adjudication application. For instance, the adjudicator will consider:
- the Act;
- the contract (verbal or written);
- the payment claim (including any relevant supporting documentation);
- the payment schedule (if any);
- the adjudication application;
- the adjudication response (if any);
- the results of any inspection; and
- any relevant supporting documentation.
What does an adjudicator determine?
The adjudicator will determine:
- the amount of any progress payment that the respondent must pay you;
- the date on which the amount is (or was) payable;
- the rate of interest payable on the amount; and
- how the ANA and/or adjudicator fees are split between the parties.
The determination will be in writing, unless both parties request otherwise. It must also include the reason for the determination.
What happens after the adjudicator determines the application?
The respondent must pay you any amount due by the date in the adjudicator’s determination. If the respondent refuses to comply, you will need to take steps to enforce payment.
What if the respondent doesn’t pay the adjudication amount?
If the respondent doesn’t pay the adjudication amount, the claimant can ask the ANA to provide an adjudication certificate. The adjudication certificate will allow you to get a judgment debt by filing the following documents with the court:
- the adjudication certificate;
- the ‘registration/filing of certificate of judgment or order’ form; and
- an affidavit.
The affidavit must:
- state that the whole or any part of the adjudicated amount has not been paid at the time the certificate is filed;
- be sworn or affirmed before a justice of the peace or solicitor.
The court will then give you a certificate of judgment which is enforceable in the same way as any court judgment, without the need for the court to decide the matters in dispute.
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